Statements highlighting high costs of settlement and custody under Strate are misleading and damaging to the reputation of the South African market, says Strate CE Monica Singer.
Singer has taken issue with reports that fees charged by custodian banks for electronic scrip holding fees could amount to as much as R200 a month.
She says investors need not pay such high custody fees.
Strate's settlement costs are exceptionally low by world standards, she adds. "However, we have no control or influence over the charges that the custodian banks levy for electronic scrip holding fees."
Singer says while certain custodian banks or central securities depository participants (CSDPs) might levy such high fees, others offer own-name services for as little as R200 a year.
"Hence, there is plenty of economic scope for the small investor to participate in the activity of the JSE Securities Exchange," she adds.
According to Singer, reports about high costs of settlement and custody in the electronic settlement environment are not only misleading, but also damaging to the South African market.
"We need the participation of the individual investor in order to maintain a market system representative of all existing and prospective investors. Aware of this need, Strate's costs are among the world's lowest, while those levied by certain CSDPs are insignificant.
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